The new Section V.1 of the Russian Tax Code, regulating transfer pricing issues came into force on 1 January 2012 (enacted by the Federal law dated 18.07.2011 N 227-FZ). The Article 105.16 of the Tax Code establishes the obligation of taxpayers to file notifications on controlled transactions, made during the calendar year (hereinafter - “Notification”).

The taxpayers shall notify tax authorities on controlled transactions, made in 2012, if the profit gained from such transactions exceeds 100 mln. rubles. Notifications on controlled transactions, made in 2012, are to be filed by taxpayers by 20 May 2013.

Notifications (either in hard copies and or in electronic form) shall be submitted to the tax authority in the place of taxpayer’s location (residence). Taxpayers referred to the category of major taxpayers file the Notifications to the special major taxpayers’ tax authority. The tax authority forwards the Notification to the Federal Tax Service within 10 days as of its receipt. In case the taxpayer finds out any inaccuracies, omissions or mistakes in Notification, he is entitled to submit the amended Notification.

The Notification shall contain the data about the ground for attributing the transaction to the category of controlled ones, its subject matter, participants), received income (incurred expenses) etc. Currently, the form of the Notification as well as the procedure of its filling in and submission are regulated by the Federal Tax Service Order dated 27.07.2012 ? ???-7-13/524@ “On approving of the form of notification on controlled transactions, Order of its filling in, as well as of the Format of submission of notifications on controlled transactions in the electronic form and of the Order of filing notifications on controlled transactions in the electronic form”.